CoreLogic: Largest Number of Australian Homes Valued at Over $1 Million

The most recent CoreLogic report revealed that a record number of Australian homes now cost over $1 million (US$684,060).

The latest Million-Dollar Markets report showed that 29.3 percent of the 4,772 surveyed suburbs had median values of $1 million or higher as of August.

This marks an 8 percent increase from the previous figure of 21.7 percent in January 2023 when property values stabilized after interest rate hikes.

In contrast, at the beginning of the COVID-19 pandemic, only 14.3 percent of housing markets had surpassed the million-dollar mark.

Sydney and Brisbane each had 46 suburbs cross the million-dollar mark.

This was followed by greater Perth (36 suburbs), regional Queensland (30 suburbs mainly in Gold Coast and Sunshine Coast), greater Adelaide (29 suburbs), and regional New South Wales (22 suburbs, with Casuarina in northern NSW reaching a median of $2,320,189).

Among capital cities, Sydney had the highest house prices with a median of $1,180,463.

Following Sydney, Brisbane saw dwelling values increase by 15 percent over the past year to $875,040.

CoreLogic economist Kaytlin Ezzy mentioned that interstate migration and housing stock shortages have led to the rising property values in Brisbane, which have surged by 65.1% since the start of the pandemic.

In contrast, Melbourne and regional Victoria experienced a decrease in dwelling values of -1.0% over the year, influenced by an unfavorable tax environment affecting landlords and an uptick in new housing constructions.

Housing Inflation Still Strong

Meanwhile, according to the Australian Bureau of Statistics data released on Sept. 25, the housing sector did not see relief in inflation.

The report indicated a 5.1% increase in prices for new homes and major renovations over the past year. Builders raised prices to cover rising labor and material expenses.

Rents also rose by 6.8%, slightly lower than the 6.9% increase seen in July. This surge in rental prices is primarily due to limited availability of properties in most capital cities.

According to CoreLogic, affordability remains a significant concern at the national level.

Homebuyers now allocate a larger portion of their income towards mortgage payments.

For instance, a household with an $800,000 loan would require an annual income of nearly $200,000 to ensure that repayments remain below 30% of their income.

This represents a significant increase from the approximately $125,000 needed prior to the initial interest rate hike.